New York Tops Silicon Valley in Fintech Venture Financing for the First Time
June 23 2016 - 9:27AM
Business Wire
$690 million flowed to New York, $511 million
flowed to Silicon Valley in Q1 2016
Investments shift away from fintechs that
compete against financial institutions to those that partner with
them
New York received more financial technology (“fintech”) venture
financing than Silicon Valley for the first time during the first
three months of this year, according to a new report by Accenture
(NYSE:ACN) and the Partnership Fund for New York City.
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(Graphic: Business Wire)
The report, “Fintech’s Golden Age,” showed $690 million flowed
to New York and $511 million flowed to Silicon Valley, highlighting
the city’s rapid rise as a fintech hub. Last year, fintech
investment in New York tripled to $2.3 billion, accounting for
nearly 10 percent of all fintech investment globally.
“We are now in a golden age of fintech,” said Robert Gach,
Capital Markets managing director for Accenture Strategy and
co-founder of the FinTech Innovation Lab. “Venture capital is
driving major innovations. But it is difficult for fintechs –
particularly in the U.S. – to grow and scale on their own, so
investments are shifting to fintechs that partner with rather than
compete against traditional institutions. That is positioning New
York at the epicenter of the fintech boom.”
“Six years ago very few people knew what ‘fintech’ meant; now
it’s a center stage topic around the world,” said Maria Gotsch,
President and CEO of the Partnership Fund for New York City and
co-founder of the FinTech Innovation Lab. “Within that time fintech
has become a multi-billion dollar force in New York’s
entrepreneurial and financial services ecosystem. Entrepreneurs are
drawn in by the city’s tech talent and close access to potential
customers, while Wall Street has opened up to this new avenue of
innovation.”
From Competition to Collaboration
The report, which is based on an analysis of CB Insights data,
also showed that fintech investment in North America has shifted
away from ventures that compete against financial institutions and
toward those that partner and collaborate with them. In 2010, 60
percent of North American fintech investment dollars went to
ventures that compete against traditional institutions, while 40
percent went to those that collaborate with them. In 2015, the
ratio was reversed.
That change was far more pronounced in New York: 37 percent of
New York investment dollars went to fintech ventures that
collaborate with financial institutions in 2010; and that number
had increased to 83 percent in 2015.
According to Gach, “The reality of the U.S. regulatory landscape
– combined with the surging demand for digital innovation – makes
the fintech investment boom a watershed for banks. With friction
easing and cooperation growing between entrepreneurs and
institutions, financial services firms need to take the next step
to deeper adoption and integration of these innovations.”
About Accenture
Accenture is a leading global professional services company,
providing a broad range of services and solutions in strategy,
consulting, digital, technology and operations. Combining unmatched
experience and specialized skills across more than 40 industries
and all business functions – underpinned by the world’s largest
delivery network – Accenture works at the intersection of business
and technology to help clients improve their performance and create
sustainable value for their stakeholders. With approximately
373,000 people serving clients in more than 120 countries,
Accenture drives innovation to improve the way the world works and
lives. Visit us at www.accenture.com.
About the Partnership Fund for New York City
The Partnership Fund for New York City is the $115 million
investment arm of the Partnership for New York City, New York’s
leading business organization. The Fund’s mission is to engage the
City’s business leaders to identify and support promising NYC-based
entrepreneurs in both the for-profit and non-profit sectors to
create jobs, spur new business and expand opportunities for New
Yorkers to participate in the City’s economy. The Fund is governed
by a Board of Directors co-chaired by Charles “Chip” Kaye, co-chief
executive officer of Warburg Pincus, and Tarek Sherif, Chairman and
CEO of Medidata. Maria Gotsch serves as President and CEO of the
Fund. More information about the Fund can be found at
www.pfnyc.org.
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version on businesswire.com: http://www.businesswire.com/news/home/20160623005313/en/
AccentureMelissa Volin, + 1
215-990-4647melissa.volin@accenture.comorPartnership Fund for NYC /
Rubenstein CommunicationsFarrell Sklerov, + 1
212-843-8289fsklerov@rubenstein.com
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